Monolithic Power Systems Inc (MPWR)

Total asset turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	2,207,100	1,821,070	1,794,150	1,207,800	844,452
Total assets	US$ in thousands	3,617,100	2,434,350	2,058,880	1,585,820	1,208,490
Total asset turnover		0.61	0.75	0.87	0.76	0.70

December 31, 2024 calculation

Total asset turnover = Revenue ÷ Total assets
= $2,207,100K ÷ $3,617,100K
= 0.61

Total asset turnover is a financial ratio that measures a company's efficiency in generating sales revenue from its total assets. A higher total asset turnover ratio generally indicates better asset utilization.

Analyzing the data provided for Monolithic Power Systems Inc, we observe the following trends:

- In December 31, 2020, the total asset turnover was 0.70, indicating that the company generated $0.70 in sales revenue for every $1 of total assets.

- By December 31, 2021, the total asset turnover ratio improved to 0.76, suggesting an increase in the efficiency of asset utilization to generate sales.

- The total asset turnover ratio further increased to 0.87 by December 31, 2022, reflecting continued improvement in asset efficiency and potentially more effective management of assets to drive sales growth.

- However, by December 31, 2023, the total asset turnover ratio declined to 0.75, indicating a slight decrease in the efficiency of asset utilization compared to the previous year. It could be indicative of challenges in maintaining or further improving asset productivity.

- The trend continued with a notable decrease in total asset turnover to 0.61 by December 31, 2024, signifying a significant drop in the company's ability to generate sales revenue from its total assets compared to the previous year.

Overall, the varying total asset turnover ratios over the years suggest fluctuations in the efficiency of Monolithic Power Systems Inc's asset utilization to drive sales revenue. It would be essential for the company to focus on optimizing asset utilization to enhance productivity and overall financial performance.